by Elad Gil
Claire: That’s exactly right. So how do you manage expectations and actually celebrate some of what is chaotic about what you’re going through? That’s my advice: figure out a way to get ahead of that and get people ready for inevitable changes so that you don’t have fears or concerns that are unfounded.
Elad: There’s a lot of confusion around how to approach strategic planning and decision-making as startups scale. What are the different levels at which companies should be planning? How do these different levels come together, and how frequently should a company do them?
Claire: I think this is definitely an area that needs to evolve as companies evolve and as they scale. If you’re pre-product/market fit, you probably need a different cadence, one that’s a little bit more agile as you’re finding traction. It might focus more on the short term: “Okay, here are some milestones we need to get through in order to start testing and proving that we can have product/market fit.”
Whereas once you have traction with some core product, you should fairly quickly be able to get to key targets or metrics that matter as indicators of progress. You should be able to say, “Here are our short-, medium-, and long-term goals to really build this out.” Because usually once you initially get traction you still have a lot of work to do to take advantage of it and to expand on it.
There is a balance between focusing too much on either the short term or the long term. The key to me is having two documents. The first—at Stripe, we’re calling them charters—articulates the long-term view of why this team or this product or this company exists, what its overarching strategy is, and what success would look like over even a three-to-five-year period. And then the second is a shorter-term plan: “Okay, in the near term, then, what are we trying to get done?” That can look like a results-based management model or an OKR—objectives and key results—model. But it’s some way that a team can say, “This is where we’re going long term. And on a quarterly basis, this is where we’re focusing. We’re hoping to move X and Y metrics.”
If you’re working on an early-stage product, even within a company that has a more mature product, that shorter-term plan looks different. You probably don’t know what X and Y metrics are yet. You’re still in the milestone mode. Any planning process needs to accommodate product life cycle, if you will. You want to establish buckets that the company understands to capture each of the product stages you have.
At every stage, though, you want to find a balance between that long-term charter (“Why do we exist?”) and the short-term plan (“What are we going to do?”).
Elad: How do you think about iterating on each of those? For example, should the long-term charter be refreshed annually? Semi-annually? What’s the cadence for that document versus the cadence for your goal-setting or OKR document?
Claire: I think a charter needs a re-look roughly annually. And the goal-setting and OKRs is probably more like quarterly or bi-annually, depending on what kind of product you have. One thing that we do annually now—in addition to the charters—is set company metric targets for the coming year. We’re adjusting the plans against those targets every quarter too.
Elad: How far ahead do you think your charter or strategic plan should go?
Claire: One thing that I have really thought about is the set of what I’m going to call “founding documents” that are really important for any company to have, especially as you get beyond, say, 50 or 100 people. That includes your mission statement and your vision, but also your overarching long-term goals. When we wrote that document for Stripe, I thought of as it the three-to-five-year plan. But we just called it long-term goals publicly in the company. And if you read those goals again today—and I worked on them, the leadership team worked on them, three years ago—they’re still the same. And I don’t think they’re actually going to change even in three to five years. They’re our long-term goals.
Then the other thing you have is your operating principles or your values or whatever vocabulary you choose. You need to codify a set of principles and behaviors and then cohere to them, culturally. And those founding documents shouldn’t change very often. We refresh those operating principles every year, but they don’t change that meaningfully. I don’t think founding documents should change frequently.
When it comes to a given product or area of the business, then the longest you’re probably going to project out is three years. Because things are changing so rapidly when you’re at a growth stage that you can’t really go much past that. We have a finance plan where we try to look three years out so we can test some of our assumptions. But we’d be pretty hard-pressed to make that meaningful in a five-year period.
Elad: Who do you think should own generation and implementation of charters and OKRs? When I was at Twitter, for example, I was asked to help implement OKRs across the company, and at the time the company was 500 people. So it needed Dick Costolo, who was CEO at the time, to pound the table for us. Because, at that scale, unless you have the leader of the company reminding everybody, things like that just aren’t going to happen. It was so late in the evolution of the company.
At what scale people should adopt these different processes? And then who do you think should own them on an ongoing basis?
Claire: I think adopting some planning framework early will serve a company well. I was giving a talk recently at a startup, and they asked what operating processes I thought should be in place when. I told them that I’m not going to tell you which operating processes you should put in place. But I will tell you that you need them, and you need them sooner than you realize.
The analogy I drew was to games, or sports. I said, “You know why playing a game is fun? Because it has rules, and you have a way to win. Picture a bunch of people showing up at some athletic field with random equipment and no rules. People are going to get hurt. You don’t know what you’re playing for, you don’t know how to win, you don’t know how to score, and you don’t know what the objectives are.”
Everyone was nodding along—and this is a 40-person startup—but I could tell that they’re struggling, because they don’t really have any core goals. They’re definitely in a product/market-fit, find-our-way mode, so I don’t think they should have anything too heavy. But organizations need constraints and objectives to optimize against, so that people can actually independently make decisions.
When I first came to Stripe, we didn’t have OKRs or even the charter or the planning process we have today. We had six company goals and that was it. And what we did in my first couple of quarters was just push the goals process down a little bit into teams. And that was pretty good for about 6–8 months. That helped us get people at least to know what different teams were up to. But earlier than you think, you need these structures, and you have to choose which ones make sense for you. Ultimately, our early approaches weren’t totally right—either for Stripe as a business or maybe we grew out of them—but we were building the muscle of stopping to plan and think ahead, of creating objectives and measuring progress, and that is the main thing you need: the organizational capability from an early stage.
And then in terms of who should own it, really leaders need to own it. This needs to be something that waterfalls and has accountability all the way down through the company. And I do think the leadership team, including the CEO, has to be quite involved. I don’t think they have to lead the process every time, but they have to be visible participants.
That’s my view: you need planning structures earlier than you think, and they should proceed all the way from the top down.
“You need to codify a set of principles and behaviors and then cohere to them, culturally.”
—Claire Hughes Johnson
Elad: One challenge is if you have one or two people on the executive team who haven’t worked in large organizations before, sometimes you’ll end up with resistance in the executive team itself to adopting these processes. Then six months after they’ve been adopted, they’ll say, “These are great.
I wish we’d always done these.” But it’s often quite painful early on.
On this topic more generally, where do you think founders should continue to be involved over time, and where do they often fail to delegate? I’m curious if you’ve seen common patterns across different companies. Are there things that people often need to let go? Or, alternatively, maybe things they shouldn’t let go, but where processes would allow them to distribute decision-making so the important stuff bubbles up to them?
Claire: I’m a big self-awareness advocate, and I would say there are two things you’ve really got to spend a good amount of time on as a founder or CEO and a leadership team. The first one is, what are things that only the founder/CEO can do and which are existential to the company? What must they spend time on? One of those is often recruiting additional leaders. Others would be, in most companies, articulating the product vision and setting cultural standards.
Figure out what those are, and figure it out quite transparently with the rest of the leadership team. Then do a big self-awareness exercise across that leadership team, in terms of skills, capabilities, past experience, strengths. See if you can deploy the group against your needs and objectives, and be really ruthless about what the CEO and founder has to be involved in. Part of that will be them weighing in on what they want to be involved in versus what they have to be involved in. And ideally, you want that documented, their preferences on how they’d like to be involved and their role description in terms of where they have to be involved.
Instead, though, this stuff often goes way too organically and becomes opportunistic. “Oh, we hired this person. They have this background so we’ll have them do this.” You’ve really got to think through it as a group and you’ve got to connect it to the company’s strategy and products.
This interview has been edited and condensed for clarity.
INSIGHTS
Working with Claire:
an unauthorized guide
First of all, I’m really excited to be working with each of you and your teams.
Operating approach
Bi-weekly or weekly 1:1s. We’ll try to keep the times consistent so you can plan. I’m a big fan of a joint 1:1 doc to track our agendas, actions, goals, and updates.
Weekly team meetings, as appropriate—I view these as both update and decision-making/work review forums. I expect people to be prepared and to participate, even though we’ll have to manage video conferences and time zones.
Quarterly planning sessions—it’s my hope we make these happen with strong pre-work and good follow-up afterward with our teams and partners (internal or external).
It’s possible that we’ll have some Stripe separate business review-type meetings and we can work hard to keep work manageable between these and planning sessions. Stay tuned.
Speaking of 1:1s We’ll do a career session at some point in our first few months of working together—your history, why you’ve made choices you have made, what your ambitions are for the future, etc. These help me know where you are in terms of personal development interests and ambitions with respect to longer-term plans.
Personal goals—I believe in the two of us reviewing the top 3-5 personal goals you have each quarter or so (these are the things that you personally spend your time on, not your team plans, which I know you also spend time on...). We can discuss them each Q and then mark out a plan on how we make sure you get the time, space, and support to accomplish what you need. I do these every 3–6 months and will share mine with everyone, also.
Your teams Please add me to emails (fwd as FYI or add me) or documents that might be helpful for me to see as a way to understand the team and day-to-day work.
As work is ongoing or a team member does a great job on something, forward it or link from our 1:1 doc. I like to see WIP and I am happy to meet with folks who have done great work so they can walk me through it—your discretion.
Finally, I look forward to personally meeting everyone on your team and let’s keep an eye to make sure I’ve done that over the next few months.
Manager Handbook
Management style
Collaborative
I’m very collaborative which means I like to discuss decisions and options and whiteboard big stuff in a group. I will rarely get stuck in one position or opinion but the downside is that you won’t always get a quick judgment out of me—I need to talk it through and see some ideas/data/options. Due to this bias, I can sometimes be slow to decide and if you need a decision quickly, make sure I know it.
Hands-off
I’m not a micro-manager and I won’t sweat your details *unless* I think things are off track and if I do, I’ll tell you my concern and we can work together to make sure I understand and plan together on how to communicate better or right the situation. That said, when I am new to a project/team I often get into the work alongside people so I can be a better leader—I will get involved in details and be more hands-on early on in a new initiative and just be warned on that. It’s how I will know how to help if you need me later.
I expect you are making decisions a lot without me and if you come to me I’ll usually put it back on you with, “What do you want to do?” or “What should you do?” and just help you decide. That said, if there is a big one brewing, I’d love to know about it and I’m always here to talk it out. I like to know what’s going on with you and your team.
Accountable and organized
I take action items really seriously and I expect you to know what yours are, when they are due, and get them done. I don’t like chasing them but I do notice when things slip—it’s fine to renegotiate deadlines but I’ll be annoyed if it’s the day after the deadline....
I dislike being caught last-minute with people working hard on something we could have gotten ahead of—please help anticipate big work efforts and let’s be in front of them together. Similarly, I want us to be ruthless in priorities while we are resource-constrained. I need you all sane...and me too.
Data-driven
I like data and dashboards so there is one, objective (ideally) way to measure progress and results but I dislike being bogged down in data and torturing the numbers. Let’s review consistent information on what really matters and use data to get insight, not to lull ourselves into thinking we know what’s going on or to try to find answers that might involve going with our gut.
I also like to make agreements on “how we do things” that we then agree to vary/make exceptions on as a group versus everyone inventing their own process/frameworks.
If we’re discussing something and you know of or can imagine data that would be useful to our decision, bring it up. (See below—sometimes I go into intuitive mode and I should be analyzing first.)
But intuitive?!
I’m also intuitive about people, products, and decisions which means I’m happy to handle situations when I don’t have a lot of facts or data. You’re thinking uh-oh, she’s going to jump to conclusions, but I’ve worked hard in my career not to be that person. Ultimately, I think I have a good gut but I’m not wedded to it. *Your* job is to get my sense of something and argue it out with me. I love a good fight to a better outcome.
I use my intuition a lot with talent management and I’ve been told I am a good “read” on people. Again, I work hard not to judge or jump to conclusions but I will put forward hypotheses about your team members and your job is to make sure I really know the people.
I always like to know what’s going on personally with people so I can see the whole picture. I am a believer that we are “whole selves,” not work selves and home selves and it will help me know you and your team better if I know context. If something hard is going on with someone on your team, I’d love to know and be there to support you/them.
Strategic
I try to think about where things will end up and the straightest line to get there but I’m pretty flexible along the way. If there is swirl I usually think to myself: “What’s the big lever here?” “Wh
at problem are we trying to solve?” “Why do we need to solve it?” “When do we need to solve it?” “What information do we need and when will we get it?” and I expect you to do the same. Every day I try to think about what’s the most important thing I can do and do that above all else. But sometimes I get buried under email and fail!
By the way, I am often overly generous with my time and say yes too often to things. If you see this, please flag it to me. Although I love meeting with people, I sometimes don’t spend enough time on the strategic stuff because I am working on other things. Help keep me honest.
User oriented
I put this last because I think of my key leverage as more about scale than individual customer work, but I’m always interested in sales status, customer issues, customer stories, and meetings with users, especially when I’m traveling.
Communication
1:1s
Use 1:1s for items better discussed verbally and items that can wait for our weekly check-in. Email takes a *ton* of time, so use it wisely.
If we don’t have a 1:1 for a while, feel free to email or ping, of course.
Email
I read fast but I have slight carpal tunnel in my left arm and I don’t love writing super long emails, nor do I think they’re very productive, although watch me break this rule on occasion!
I will read every email I get in a day but I don’t respond just so you know I read it—I’ll only respond if you ask me something directly or I have a question. Thus, assume I did read the email within 18 hours, but if you think I owe you a response please resend or ping me and I won’t be offended.
